Friday, July 01, 2011

Obama's New Tack?

-- Posted by Neil H. Buchanan

I have been highly critical of President Obama (most recently, here), finding his policies and strategies either naive or unprincipled (leaning ever more strongly toward the latter). I was, therefore, surprised by his sudden change of tack earlier this week. In a much-discussed press conference, Obama took a strikingly aggressive tone with his political opponents, especially on economic and budgetary issues. He was highly critical of the Republicans' rigid opposition to collecting more tax revenue, from any source and by any method, saying that the GOP's policies favored corporate interests and the wealthy over everyone else. In other words, he finally did what I had long hoped he would do. What are we to make of this new approach?

The new tone is especially surprising because the underlying electoral reality has not obviously changed. That is, Obama is rightly confident that his supporters have nowhere else to go. As much as people like me moan and complain, everyone knows that we will support Obama for re-election next year, first grudgingly but with increasing enthusiasm as we contemplate the prospect of any of his potential opponents as president. Triangulation, in other words, is even more reliable now than it has ever been, with the stakes being too high for progressives even to consider sitting on their hands in 2012.

Moreover, there is apparently no alternative to Obama's approach, even in the longer term. The hero of the moment, Governor Andrew Cuomo of New York, who is rightly being described as the early front-runner for the 2016 Democratic presidential nomination, is arguably even worse than Obama on economic policy. Cuomo reportedly "calls himself 'an aggressive progressive' and thinks liberals have to reorient themselves toward a government with goals and effective service, rather than big government." I do not know of any liberal who has ever been against having a government with goals and effective service, nor do I know of anyone who can even meaningfully define what "big government" means, other than as a rhetorical device to shout down policies that help the non-rich.

In any event, with both federal and state governments under assault, Cuomo's insistence on allowing New York's most progressive tax provision to lapse, as well as imposing property tax caps that will guarantee regressive changes in school financing across the state, is simply bad policy. Even in an alternative universe where Obama could be challenged in the primaries in 2012, Cuomo would offer nothing attractive on economic policy to challenge Obama.

Obama's sudden populism is also hard to understand, in light of his opponents' (and the Belthway media's) predictable response. Senate Minority Leader Mitch McConnell immediately talked about Obama's agenda to raise people's taxes, and the leaders in the House were even more on script. Politicians and pundits on the right immediately attacked him for renewing "class warfare" (another meaningless taunt), harping on his repeated references to a tax break for corporate jet owners. Even non-opinion sources described this provision as small, with forecasts indicating that it would result in about $3 billion in additional revenues over 10 years, while failing to point out that that amount of money is sufficient to forestall Republicans' proposed cuts in nutrition programs for poor children (as only one example).

If Obama somehow thought that the current environment had made it more likely that Republicans would adjust their stance, or that news coverage would be any less slanted than it has been to date, he apparently miscalculated. It is difficult, however, to imagine that he could have actually believed that his opponents could change their stripes now. What else could he be thinking?

One possibility is that he has concluded that accommodation had turned into appeasement, and he has had enough. In this scenario, he has finally read the polls that show that most Americans are not against tax increases, and he is no longer going to adopt the Democrats' accustomed defensive crouch on the issue. Twenty-eight years after Walter Mondale's famous admission that he would raise taxes if elected (coupled with his 100% accurate prediction that Reagan would do the same), maybe Democrats have decided that the lesson they learned from that electoral drubbing has been superseded in the midst of a (completely contrived, by both sides) short-term budgetary crisis.

If that is true, then it is heartening that Obama is choosing to push for tax increases that are actually progressive. Many Democratic-leaning analysts, after all, would be all too willing to push for regressive tax changes in the name of deficit reduction. For Obama now to push loudly for the end to low tax rates for hedge fund managers' incomes, for example, is clearly the better path. Maybe we are seeing the first indications that Obama has concluded that left-leaning populism is actually a winning strategy, as well as good policy. If others are right that Obama is really a deep-down liberal who has only reluctantly taken on the Clintonian New Democrat mantle (which strikes me as more wishful thinking than anything else on the part of liberals), then this represents Obama's moment of liberation.

This might, however, be a one-time thing. Within days or weeks, we could see the same old Obama, excoriating his base for being unrealistic, giving away political ground for no apparent reason, and wondering why people no longer love him. This seems highly likely, because Obama has to know that his opponents will not respond to polling that shows them losing the news cycle, preferring instead to keep to their long-term, highly successful strategy of holding out for more concessions from Obama. When the deadline for raising the debt limit finally arrives, they know who will blink.

Finally, we must not forget that Obama's progressive tax proposals are being offered in a context of proposed spending cuts that are enormously regressive. In his press conference, Obama framed his minimalist tax proposals as something that the Republicans should agree to, given that he and the Democrats have already given so much ground on their putative priorities. As a New York Times news article put it: "Even if all these changes to the tax code were accepted, they would still amount to only a sliver of the $4 trillion in savings that Mr. Obama has said he wants to achieve."

Maybe we have reached the point where we should be happy that the president is willing to include even a sliver of progressivity in his policy proposals. Especially given the likelihood that he will soon abandon those proposals, however, I remain unimpressed.